"These 6 'Alpha' Stocks to Watch Now Even as KOSPI Falls" [Weekend Money]

Despite Oil Prices and Interest Rates Pressuring the Market,
There Are Always Stocks Generating ‘Alpha’ Returns
"Focus on Companies That Deliver Earnings Beyond Expectations"

Amid growing uncertainty in the macroeconomic environment, experts advise that investors should focus on stocks that delivered strong second-quarter results and continue to show price momentum this year.

On the 13th, the KOSPI index started the session at 6773.92, up 194.88 points from the previous trading day. The status of the domestic stock market is displayed on the electronic board in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. August 13, 2026. Photo by Kang Jin-hyung

Meritz Securities emphasized the need to pursue 'alpha' (excess returns) from companies that deliver earnings above expectations, even in an environment that is not favorable for the stock market.

In the second quarter of this year, KOSPI operating profit and net income reached 238 trillion won and 225 trillion won, respectively, marking quarter-on-quarter increases of 34.4% and 53.7%. However, excluding the semiconductor sector, operating profit and net income each declined by 5.3% and 12.7%.

The current market macro environment is viewed as somewhat burdensome. The price of West Texas Intermediate (WTI) crude oil futures has once again surpassed the $80-per-barrel mark, and the yield on the U.S. 30-year Treasury bond has remained above 5%, increasing the likelihood of downward pressure on the stock market. As a result, there are forecasts that, in the short term, the market could face an earnings recession accompanied by both declining interest rates and falling earnings.

However, even during weak markets, there have always been stocks capable of generating excess profits. Although the KOSPI has fallen by 1.9% this month, stock prices in 19 industry sectors have risen.

Meritz Securities stresses the importance of following market-leading stocks but emphasizes the need to select those whose earnings have exceeded expectations. Attention should be paid to stocks meeting both criteria: being in the top 20% for both second-quarter net income surprises and third-quarter returns this year. Notable examples include HD Hyundai, Korea Gas Corporation, Hanwha Life Insurance, Hanwha Aerospace, GS, and Hyundai Marine & Fire Insurance.

Lee Sang-hyun, analyst at Meritz Securities, commented, "This is not an environment favorable for the stock market, considering rising interest rates, higher expectations for earnings, and weakened additional funding capacity. In the end, investors need to look for excess returns from companies that post profits surpassing expectations."

This content was produced with the assistance of AI translation services.